Washington Post sold for $250 Mil to Jeffrey P. Bezos, Amazon Bro

[downtown]

The Washington Post, one of America's great newspapers, has been sold for the relatively paltry sum for 250 million in cash to Jeffrey P. Bezos, CEO of Amazon.

The purchase of The Washington Post by Jeffrey P. Bezos ends 42 years in which The Post has been part of a publicly traded company, creates a small windfall for the company’s shareholders and will leave the stewardship of the newspaper in the hands of a privately held firm.

When Bezos, the founder and chief executive of Amazon.com, closes on the $250 million purchase of the paper in about 60 days, it will be the latest in a series of purchases of “legacy” print media properties by wealthy individuals and small groups, a list that also includes the Boston Globe, the Philadelphia Inquirer and Newsweek.


The company has agreed to sell its flagship newspaper to the Amazon.com founder.

The purchase price is richer than many of those paid for other legacy print media properties in recent years.

The New York Times Co. agreed to sell the Boston Globe to Red Sox owner John W. Henry for only $70 million. Newsweek sold for a symbolic $1, plus assumed pension liabilities, to billionaire Sidney Harman in 2011.

The Post “has a much stronger position in its market than the Boston Globe does,” said John Morton, an independent newspaper industry analyst. “It doesn’t surprise me that it would command a much higher price.”

Still, Morton suggested that the prominence and the visibility of The Post made Bezos willing to pay a higher price than would be justified by the paper’s finances alone. “I think probably Jeff Bezos was willing to pay a premium to make this happen,” Morton said. “. . . Bezos has enough money that if he wants to make it a hobby, he can.”

The deal was announced after the end of trading Monday. In after-hours trading, Washington Post Co. shares rose about 5 percent to $568. The company’s stock is up nearly 57 percent this year. The purchase price works out to $40.32 a share for Post shareholders.

The transaction is a reflection of how much has changed in the news industry in just a short time amid the rise of online media that have put print advertising business models under steep pressure.

“This newspaper would’ve sold 10 years ago for $2 billion,” said Craig Huber of Huber Research Partners.

Notably, Bezos — through a new holding company called Explore Holdings — will be buying only the Post newspaper and closely held related ventures.

The purchase does not include The Post Co.’s downtown Washington office buildings (currently on the market as The Post considers leasing new space in a cheaper neighborhood) or the wharves and warehouses owned as part of the Robinson Terminal facility in Alexandria.

Full article can be found here: http://www.washingtonpost.com/busin...8a2bc4-fe1b-11e2-9711-3708310f6f4d_story.html

Couple of interesting thoughts here:

1) Bezos is ONLY buying the Washington Post Newspaper, not Slate, not the office buildings, not the Washington Post Company, or any of their highly profitable education holdings. I imagine the Washington Post Company will change their name.

2) It is wildly speculated that a major reason for Bezos buying the newspaper is for political clout. WaPo probably has more potential political leverage than any other newspaper, except for maybe the New York Times.

3) It is also speculated that as far as potential owners go, Bezos is probably a good one for a major newspaper, given that he has the capital to handle losses for a while, isn't looking to reshuffle all the editorial talent, and has the tech knowledge to perhaps help the paper be more profitable in that space. He admits that he doesn't have a "plan" yet.

4) The Boston Globe, probably a top 10 newspaper in the US, sold for 70 million, or cheaper than the contract for a great Major League Baseball player.

5) Bleacher Report, a sports website wildly mocked for terrible quality and SEO whoring, was recently sold for $200 million. Taking into account pension liabilities, B/R sold for more money than The Washington Post, the nation's 2nd most influential newspaper. I will now set myself on fire.

What do you think? Is there any life left in newspapers? Do you think Bezos will be a good owner, or is the Post screwed? Are we left to let our national media and 4th estate become essentially Buzzfeed? IS THIS WHY WE CAN'T HAVE NICE THINGS?

 

[Terxpahseyton]

If Amazon wage practices are in America anything they are in Europe I would be wary of this.

 

[warpus]

Was it sold so cheap because printed media is on the downturn?

 

[Zelig]

If Amazon wage practices are in America anything they are in Europe I would be wary of this.

Amazon didn't purchase WashPo, Bezos did.

 

[Terxpahseyton]

At this point there seems to be little difference.

 

[downtown]

Was it sold so cheap because printed media is on the downturn?

Yes, and also because of pension liabilities.

 

[nerdfighter13]

I get the Post and saw a few articles about this on the front page and plan to read them.

 

[Cutlass]

Newspapers are generally in a lot of trouble. In part this reflects a changing nature of the market. But many papers were irrevocably damaged by investors as well. Many were bought by some investment firm, saddled with debt, and then content stripped out until revenue started falling too steeply. The investors never grasped the concept that if you remove a lot of the content from papers, then you are removing readers, and so removing both subscription revenue, and ad revenue.

I think we're going to see papers moving ever more into 2 trends: 1 is tiny local papers, and the other is regional papers with little local content. The Boston Globe, for example, already covers all of northern New England as the only big Sunday paper printed there. And the NYT sells through a lot of Connecticut already.

 

[Samson]

This is an interesting move. I note that this is a personal aquisition, not being bought by Amazon. It COULD be exactly what the WaPo needs, enough money to survive some losses, and the web know-how and pressence to move effectively into the "new media" arena.

My other thought is that if this fails, it could leave the USA with only 1 quality paper, so no competition. I cannot imagine that being good for the state of investagative jornalism, and so democracy as a whole.

 

[Formaldehyde]

AFAIK there wasn't anything fiscally unsound about the Washington Post.

Major newspapers shouldn't be owned by individuals for obvious reasons. I have no idea what they were thinking when they agreed to this.

 

[downtown]

If not individuals, and I assume you aren't crazy about corporate control, then who?

The Post wasn't in nearly as bad shape as most other major papers, but it was losing profitability and the family had wanted to sell for about a year.

 

[Formaldehyde]

When did I say anything about corporations? Although I am certainly opposed to Murdoch's empire which is ostensibly one...

Major newspapers simply have too much political clout to be owned by rich people like Jeff Bezos and Rupert Murdoch. Your own OP even alludes to this.

 

[Dachs]

I get the Post and saw a few articles about this on the front page and plan to read them.

This is an understatement. They had a headline in massive type usually reserved for major terrorist attacks and presidential elections. And the front page was completely plastered with stuff on the planned transaction.

 

[downtown]

My other thought is that if this fails, it could leave the USA with only 1 quality paper, so no competition. I cannot imagine that being good for the state of investagative jornalism, and so democracy as a whole.

I get what you're saying, but the US has more than just the NYT and the Post. There are probably another dozen or so papers that have the regional or national chops to do great investigative work, although many of those are also laying people off.

The Post is one of the best ones though, and a dropoff would certainly hurt Washington coverage.

When did I say anything about corporations? Although I am certainly opposed to Murdoch's empire which is ostensibly one...

Major newspapers simply have too much political clout to be owned by rich people like Jeff Bezos and Rupert Murdoch. Your own OP even alludes to this.

You're right, you didn't say anything about corporations. I just assumed based on your previous skeptisim to corporate power.

I don't really see the difference in the ability to project political power whether it's owned by one dude or a corporation. Murdoch doesn't personally own his media companies, News Corp does. Many of the major US papers were family owned during they heydays (including, I believe, the NYT). You can have great family owners or crappy ones, or great corporate owners or crappy ones. I feel like Bezos will be able to shift the WaPo to trumpet what he wants whether he owns it, or Amazon Inc owns it.

 

[Kennigit]

Eh media tycoons inherently are a little more damaging, eg berlusconi.

 

[Formaldehyde]

You're right, you didn't say anything about corporations. I just assumed based on your previous skeptisim to corporate power.

So making up even more nonsensical stuff about my supposed opinions?

I don't really see the difference in the ability to project political power whether it's owned by one dude or a corporation. Murdoch doesn't personally own his media companies, News Corp does. Many of the major US papers were family owned during they heydays (including, I believe, the NYT). You can have great family owners or crappy ones, or great corporate owners or crappy ones. I feel like Bezos will be able to shift the WaPo to trumpet what he wants whether he owns it, or Amazon Inc owns it.

The real issue with the Washington Post Company seems to be quite related to that of the News Corp. They are really privately held by a few major stockholders. The reason they are corporations is to limit their liability and to protect the owners from lawsuits as well as to attract investment money from outside sources that actually have little or no say in how the corporation is actually run.

As you stated in the OP yourself, it is really owned and controlled by the Graham family. But unlike his parents, Donald Graham seems to be far more interested in making as much money as he can than he is in being the steward of one of the great national newspapers. I guess it is no surprise that rich people like Rupert Murdoch and Jeff Bezos will end up owning the major newspapers in this country as their financial power continues to erode due to the internet. But it remains to be seen if Bezos will interfere in the editorial policies of the Post, as Murdoch has clearly done with the Wall Street Journal. The mere change of ownership means that is now in jeopardy. I suspect the worse.

That is not to say that corporate ownership of media isn't also plagued with problems. This became quite apparent when the networks decided they must turn their news departments into profit centers, instead of being essentially their own independent entities which were largely responsible to nobody but themselves and the American people.


Link to video.

Most of the people in this forum are too young to remember how TV news was before this occurred. When people like Walter Cronkite, David Brinkley, and Edward R. Murrow truly were the fourth estate in this country, instead of far more serving the interests of the rich and the powerful while pandering to the opinions of the masses for greater financial profit.

Eh media tycoons inherently are a little more damaging, eg berlusconi.

Or William Randolph Hearst.

 

[Zelig]

Hey dt, what do you think is the minimum reasonable subscriber fee for a digital-only ad-free media outlet?

 

[downtown]

So making up even more nonsensical stuff about my supposed opinions?

You're right, there is nothing in your posting history that would indicate that you might be skeptical of corporate power. I apologize for this glaring oversight, and I hope that the people of CFC OT can see through my miscategorization to restore your reputation.

As you stated in the OP yourself, it is really owned and controlled by the Graham family. But unlike his parents, Donald Graham seems to be far more interested in making as much money as he can than he is in being the steward of one of the great national newspapers.

Lol, really? The Grahams didn't care about making money before?

That is not to say that corporate ownership of media isn't also plagued with problems. This became quite apparent when the networks decided they must turn their news departments into profit centers, instead of being essentially their own independent entities which were largely responsible to nobody but themselves and the American people.

This was never, ever, the case. Since the founding of this country, major media outlets have existed for two reasons
1) to trumpet particular political causes
2) to make gobs of money.

What has changed is the industry itself. Having TV personalities like Cronkite or Murrow are not profitable like they were before (and make no mistake, Cronkite made CBS gobs of money). If longer-form, understanded TV or print reporting was profitable, more people would be doing it. It isn't anymore.

 

[Formaldehyde]

You're right, there is nothing in your posting history that would indicate that you might be skeptical of corporate power. I apologize for this glaring oversight, and I hope that the people of CFC OT can see through my miscategorization to restore your reputation.

While I'm certainly not a far-right ideologue who fantasizes about a world where corporations can run free and do whatever they wish, I'm also not a socialist or a communist.

Lol, really? The Grahams didn't care about making money before?

"LOL, really"? All you can do is continue to create such absurd strawmen?

This was never, ever, the case. Since the founding of this country, major media outlets have existed for two reasons
1) to trumpet particular political causes
2) to make gobs of money.

What has changed is the industry itself. Having TV personalities like Cronkite or Murrow are not profitable like they were before (and make no mistake, Cronkite made CBS gobs of money). If longer-form, understanded TV or print reporting was profitable, more people would be doing it. It isn't anymore.

Glad to see you are indeed corroborating that you really don't know much at all about the history of the press in this country with such nonsensical statements. The TV news departments were notorious for their relative independence from the rest of the organization, and that they were not expected to make a profit in their own right. That they were there as a public service and to bring prestige to the network as a whole. That at one stage, Ted Turner's superstation in Atlanta was even close to being closed by the FCC because they did not have a similar news organization and did nothing overt in the way of public service. That Ronald Reagan officially ended that aspect of network responsibility when he became president.

 

[Terxpahseyton]

That Ronald Reagan officially ended that aspect of network responsibility when he became president.

Wow really?
It never ends with him.